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Procedures for Processing and Issuing Energocredit
Residential Loans In Participating Banks
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Energocredit
Procedures on Processing and Issuing Energocredit
This document is the internal document of Bank and it describes the procedures
for processing and issuing Energocredit Residential Loans. The users of this
document are the retail department staff of the bank.
The document describes only the procedures relating to Energocredit, and all
internal procedures of Banks must still be followed.
It contains the following sections:
For Retail Bankers
For Management
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Contents
1. Definition of Terms Used in the Document ......................................................................................... 5
2. Who Does What in GEEP ...................................................................................................................... 7
3. Who Does What in Bank ...................................................................................................................... 9
Due to the different participant banks responsible persons for implementing Energocredit may vary,
please contact Energocredit Team for detailed information for each PB bank. .......................................... 9
4. Residential Loan Management and Coordination .................................................................................. 10
4.1 Marketing and Promotion of Energocredit ....................................................................................... 10
4.2 Reporting to EBRD ............................................................................................................................. 10
4.3 Special Subsidy Account .................................................................................................................... 10
4.4 Coordination with GEEP .................................................................................................................... 10
4.5 Training of Credit Officers ................................................................................................................. 11
4.6 Special requirements ........................................................................................................................ 11
5. Energocredit Residential Loans ............................................................................................................... 12
5.1 Description of Loan Product ............................................................................................................. 12
5.2 Product Benefits for Residential clients and Suppliers: .................................................................... 12
5.3 Energocredit Loan Conditions ........................................................................................................... 12
5.4 Eligibility of Energy Efficient Products .............................................................................................. 13
5.5 Eligibility of Client ............................................................................................................................. 13
5.6 Non-eligibility of Client ..................................................................................................................... 13
5.7 Amount of Subsidy ............................................................................................................................ 13
6. Responsibility of Credit Officer ............................................................................................................... 14
7. Steps to sell a loan .................................................................................................................................. 14
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7.1 Bank marketing campaigns .............................................................................................................. 14
7.2 Initial Contact with the client ............................................................................................................ 15
8. Steps to Process the loan ........................................................................................................................ 15
8.1 Approval of the Loan ......................................................................................................................... 15
8.2 Agreement with the client about the loan terms ............................................................................. 16
8.3 Review of the Loan application ........................................................................................................ 16
8.4 Approval of the Loan by the Bank and Notification about Decision ................................................ 16
8.5 Preparation of Secondary Documents .............................................................................................. 17
8.6 Issuing loan ....................................................................................................................................... 17
8.7 Authorisation of Subsidy amount to the Borrower ......................................................................... 17
8.8. Request to EBRD for monthly subsidy funding from EBRD.............................................................. 18
8.9 Payment of subsidy to individuals .................................................................................................... 19
9. ANNEXES (forms) .................................................................................................................................... 19
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1. Definition of Terms Used in the Document
Loan – Energocredit – Loan for the purpose of achieving energy efficiency of homes /
apartments, for sustainable use of energy resourses ;
EBRD – European Bank for Reconstruction and Development
GEEP – EBRD Consulting Team in Georgia
Subsidy – Amount issued as a grant by BP and its business partners and EBRD, which the users
of Energocredit will be entitled to receive when the purpose of the loan is fulfilled accordingly;
Approved Supplier – Partner Organization determined in advance by the GEEP team, from
which it is possible to purchase energy efficient products/services with the loan;
Client – Physical person applying for the loan;
Energocredit application form – Special form, filled out by the client in order for the GEEP team
to approve the sum of energy efficient product(s) selected at supplier’s company
Loan application – Application form prepared by the bank which is filled out by the client in
order to apply for the loan
Borrower – A person, whose request about loan has been satisfied by the bank
Subsidy Form – Statement filled out by the borrower for presentation to Bank, in order to get
authorization for subsidy
Credit Officer – Staff member appointed by the Retail and Mortgage Banking Department, who
is responsible to receive application form, process the loan and issue the loan;
Risk Manager – Staff member of the Credit Risk Management Department, who is responsible
for making decision about issuing the loan;
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Expert – Evaluator – Staff member of asset evaluation and realization department, who is
responsible for assessment of collateral;
Act of evaluation – Document which gives the detailed description of the collateral data and
indicates its market and liquidity value.
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2. Who Does What in GEEP
The address and contact details of the GEEP office are:
17, Paliashvili Str, III Floor, 0179 Tbilisi, Georgia
Email: [email protected]
Phone/Fax: +995-32-224962
Web-site: www.energocredit.ge
The members of the GEEP Team based in Georgia are as follows:
Team Leader (overall responsible, deals with general banking issues, marketing, promotion,
management of team, financial and risk assessment, quality assurance for reports)
Helene Ryding
Email: [email protected]
Mobile: +995-595-210215
Lead Engineer (responsible for all engineering issues, approval of suppliers, approval of Energy Efficient
equipment and materials)
Kyriakos Argyroudis
Email: [email protected]
Mobile: +995-599-993702
Deputy Team Leader (contacts with banks, marketing, promotion, coordination of local staff,)
George Zurashvili
Email: [email protected]
Mobile: +995-599-288624
Residential Banking Coordinator (contacts with banks, suppliers, prepares subsidy reports)
Ana Mindorashvili
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Email: [email protected]
Mobile: +995-77-468652
EBRD London Representative for Residential Loans Administration
Ghislaine Danquin
EBRD Tbilisi Representatives for GEEP
Senior Banker:
Irakli Mekvabishvili
Email: [email protected]
EE and RES:
Irakli Vardigoreli
Email:[email protected]
Communications for Energocredit
All written communications with the Consultant are to be in English. All communications are
in electronic form.
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3. Who Does What in Bank
Due to the different participant banks responsible persons for implementing Energocredit may vary,
please contact Energocredit Team for detailed information for each PB bank.
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4. Residential Loan Management and Coordination
4.1 Marketing and Promotion of Energocredit
Marketing and promotion of Energocredit residential loans is the responsibility of BoG. GEEP will assist
to prepare appropriate materials and media as agreed.
ATTENTION IS DRAWN TO THE NEED TO INCLUDE IN ALL MATERIALS AND MEDIA VISIBILITY FOR EBRD
AND FOR BP AND ITS PARTNERS (16 logos).
4.2 Reporting to EBRD
Reporting requirements to EBRD are specified in the Credit Line agreement between EBRD and BoG.
Monthly Operations Reports (which must be countersigned by GEEP) should be submitted on the form
provided in Annex.
4.3 Special Subsidy Account
BoG is obliged to open a special account to receive subsidy payments from EBRD and to report on their
disbursement of subsidies to individual Borrowers.
4.4 Coordination with GEEP
Routine coordination
The approval of loans is a joint process between GEEP and bank Credit Officers, according to the
procedures laid down in Section 8.
Formal monthly coordination
At the end of every month it is necessary to compare data on loans and their status
(approved/pending/rejected/ accepted for subsidy payment) which have been processed by bank and
GEEP to prepare the monthly Operations Report to EBRD in which bank reports numbers of loans and
requests payment of subsidies, and GEEP reports checking of loans. Individual loans are not identified.
At this stage all loan values are converted to USD, using an average GEL/USD exchange rate for the
month, determined by bank and communicated to GEEP.
GEEP also submits a monthly Subsidy Report to EBRD listing approval of subsidy payments made during
the month. This list of payments identifies the subsidy to be paid to each individual, and is used by
EBRD London to check individual payments made by bank.
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4.5 Training of Credit Officers
GEEP is responsible for initial training of trainers. Bank is responsible for training of all other Credit
Officers.
GEEP will endeavour to deal with queries for day to day processing of loans for the first three months of
operation. Bank should provide a person responsible for answering day to day queries and training new
credit officers after that.
4.6 Special requirements
Credit officers need access to the following:
Email to communicate with GEEP
Internet to view the Energocredit website
Scanner to scan loan documents to send to GEEP
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5. Energocredit Residential Loans
5.1 Description of Loan Product
The Georgian Energy Efficiency Programme (GEEP) is the programme implementing
Energocredit loans, the aim of which is to help households reduce their costs by purchase of
energy efficient products registered on Energocredit website.
Energocredit is the brand name of the loan product sold by Banks, which is funded by EBRD
through the dedicated GEEP credit line to banks.
5.2 Product Benefits for Residential clients and Suppliers:
By the use of Energocredit the residential clients are able to:
make long-term investment in energy efficiency of their homes
reduce their energy costs and create comfort
receive 15% of subsidy by BP and its partners on the purchased item.
5.3 Energocredit Loan Conditions
The loans are meant for the purchase of energy efficient products listed on Energocredit
website: www.energocredit.ge through the loan from banks.
The loan period is set by the bank
Interest rate is set by the bank (currently starting from 14% in USD, 19% in GEL)
Collateral requirements / mortgages are set by the bank
The loan may contain more than one product eg windows and boiler
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5.4 Eligibility of Energy Efficient Products
Energocredit Residential Loans are considered only for the following equipment and materials, which
must also meet technical criteria laid down on www.energocredit.ge:
Boilers and central heating
Double glazing
Insulation for walls, roofs and floors
Solar water heating
High efficiency biomass stoves
Single family biodigesters
A list of eligible equipment and suppliers (with Model Numbers) can be found on the Energocredit
website. The list is open and new suppliers (or existing suppliers with new products) may apply to
register.
5.5 Eligibility of Client
Eligible clients are individuals, owners or tenants of premises who are creditworthy as judged
by the Bank.
5.6 Non-eligibility of Client
Client may be considered as non-eligible for Energocredit loan in following cases:
Not creditworthy
Does not apply for Energy Efficient Product
Has already taken the Energocredit loan from any of the Participating Banks and
received a subsidy; one person may obtain Energocredit Residential Loan only once
(GEEP is responsible for checking)
5.7 Amount of Subsidy
The maximum amount of subsidy is as follows:
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Description Maximum Subsidy
(USD*)
1. Double glazed windows 500
2. Insulation of wall 850
3. Floor insulation 400
4. Roof insulation 700
5. Boilers 400
6. Condensing boilers 550
7. Solar water heating 700
8. Biomass stoves 850
9. Bio digesters 850
TOTAL 5800
* – According to the exchange rate on the day of payment.
6. Responsibility of Credit Officer
Responsibilities of credit officer includes:
Displaying Energocredit materials for potential clients
Identifying suitable client for the loan
Instructing the client about eligible product
Managing application process
Sending documents to GEEP for approval
Instructing the client about subsidy request form and the acceptance
7. Steps to sell a loan
7.1 Bank marketing campaigns
Credit officer is informed about marketing campaigns for residential loans
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7.2 Initial Contact with the client
Credit officer gives detailed information to the client interested with the energocredit who
comes to the bank.
He explains to the client the purpose of the project, giving him necessary brochures,
informational materials and the web-addresses: (www.energocredit.ge), where the more
detailed information about Energy Efficient Products and their suppliers are indicated.
Credit officer forwards the client to any approved supplier in order to select desired energy
efficient product(s)/services.
Supplier, in case the client is interested, visits the client’s home and prepares an offer for the
required product and presents the client with the offer using the standard invoice (See Annex
1). The client may choose a different approved supplier to compare offers.
8. Steps to Process the loan
8.1 Approval of the Loan
Client presents the invoice to the credit officer. Credit officer together with the client checks
the invoice and product(s) for eligibility according to the list on the Energocredit Website. If the
product or supplier is not eligible and other bank conditions are met, the Credit officer may
make an ordinary loan through bank, but there will be NO subsidy.
If the product and supplier is eligible for Energocredit then the Credit officer together with the
client fills out manually the special application form of energocredit and sends the scanned
signed version of the invoice and client ID to the GEEP Residential Banking Coordinator by
email. CC goes to the head of the team, coordinator and credit administrator, in the subject in
latin characters there should be written – “Energocredit Comparison – Name and Last Name of
the Client”.
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Remark: While processing the application form, the borrower must be informed by the credit
officer, that the acceptance act must be presented no later than 4 months after the issue of the
loan, otherwise the subsidy request will not be satisfied.
GEEP Residential Banking Coordinator checks in the database whether the specific product is
registered or not with respective characteristics and whether the invoice and application are
correct. In case all data are accurate the Residential Banking Coordinator sends electronic
confirmation no later than two working days, otherwise electronically the identified inaccuracy
and its way of correction or alternative is provided. According to the GEEP Procedure Manual
7.1.5 the loans and invoices are denominated in GEL.
8.2 Agreement with the client about the loan terms
In parallel to sending the completed application form to the consulting team, while talking to
the client about the loan conditions, credit officer verbally explains to him the loan conditions
and fills out the application form with the standard procedures exsiting in the residential loans.
8.3 Review of the Loan application
The review of the application sent by the credit officer and the decision making is achieved
according to the standard residential loan procedures existing in the retail banking credit risk
department.
8.4 Approval of the Loan by the Bank and Notification about Decision
After positive or negative decision on the loan, the banker notifies GEEP by sending an e-mail
on the following:
In case of the positive decision with the subject “Energocredit Approval – Name and
Last name of client”
In case of negative decision with the subject “Energocredit Reject – Name and last
name of client”
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Cc sent to: Head of the team and coordinator
After the positive decision is made about the loan, the credit officer notifies the borrower on
the phone about the decision of the credit committee at the contact numbers given in the loan
application/ or sends him a written notice.
8.5 Preparation of Secondary Documents
Process of preparing the list of documents necessary for issuing the loan, procedure for issue of
the loan itself and signing of the loan contract is achieved with the bank standard procedures of
the residential loans.
After signing the loan contract the credit officer forms the credit filing of the borrower
according to the standard retail loan procedures and hands it over to the credit administrator
for approval of the loan. It’s already approved and signed. This can’t be right.
Filing should also contain the copy of the cost breakdown (in case of bigger projects like
mortgages) and invoice.
8.6 Issuing loan
Credit officer makes the issue of the loan electronically. Upon issue of the loan, the sum
automatically is transferred to the special account of supplier opened at Bank, with specified
type of purpose of the transfer, name of the client, invoice no and date.
8.7 Authorisation of Subsidy amount to the Borrower
Completion of work
After the bank transfers the agreed loan sum, supplier implements the installation of the
energy efficient product(s) on the site of the borrower.
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After the completion of installation and related works, the supplier prepares act of acceptance
for borrower, which is signed by the borrower in confirmation of no-objection with regard to
the quality of works implemented by the supplier.
Borrower presents act of acceptance to the credit officer.
Authorisation of Individual Subsidy Payment
Credit officer, together with the borrower fills out the subsidy request form and with the
signature of the client sends the scanned version together with the act of acceptance to the
GEEP Residential Banking Coordinator. Cc goes to the head of the team and coordinator of
bank, subject must state “Energocredit Subsidy – Name and Last name of the client”.
GEEP in maximum period of 5 days after receipt of acceptance confirms the authorization of the
borrower to get the subsidy electronically.
Applications for subsidies made more than 4 months after the loan approval will not be paid.
GEEP approves subsidies after making desk check or spot check at the Borrower’s premises.
8.8. Request to EBRD for monthly subsidy funding from EBRD
At the end of each month (28th day) the bank coordinator sends to the GEEP Residential
Banking Coordinator a monthly Operations Report in a specially designed form (Annex #16)
about the loans in GEL issued per month with a note about average exchange rate USD/GEL to
be used and the total sum of the subsidies to be paid. Bank determines the exchange rate to be
used for the month and converts loans and subsidies from GEL to USD. See also Section 4.2
Management Reporting to EBRD
GEEP compares the information with their database and in case the data are in correspondence
the electronic confirmation is sent back to the Bank coordinator. In exchange, GEEP sends the
subsidy report for the month, indicating which Borrowers are now eligible for payment of
subsidies.
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In the case of differences in data, Bank Coordinator and GEEP work together to reconcile the
differences.
Upon receipt of the agreement, Bank coordinator sends Operation Report to the EBRD London
and Tbilisi representatives requesting to transfer the subsidy amount to the special account
opened with Bank.
On the basis of the request of Bank and the acceptance of GEEP, EBRD makes the transfer of
the subsidy amount to the special account opened at Bank, from which the necessary subsidy
amounts will be transferred to the individual borrowers.
8.9 Payment of subsidy to individuals
After receipt of monthly subsidy payment from EBRD into Special Subsidy Account,
Bank pays the subsidy in GEL/USD/EUR into the Borrower’s account immediately.
Bank pays the subsidy without deduction of income tax, directly to the Borrower’s account
9. ANNEXES (forms)
Standard Invoice
Energocredit Application Form
Subsidy Form
Operations Report
Subsidy Report
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